Mercedes-Benz to exit Russian market, sells shares to local car dealer chain
Mercedes-Benz
On Wednesday, the German carmaker Mercedes-Benz said it would quit the Russian market and sell its shares in the local subsidiaries to the country’s car dealer chain Avtodom, joining several other car manufacturers to exit Moscow following its invasion of Ukraine.
“Mercedes-Benz intends to sell its shares in Russian subsidiaries to a local investor,” said the Russian ministry of industry in a statement on Telegram. It added, “The new owner of the Russian divisions of Mercedes-Benz, Avtodom, will be able to attract other companies as partners for joint productions.”
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This comes after carmakers like Nissan, Renault, Toyota and others have exited the Russian market due to its ongoing invasion of Ukraine. According to reports, Avtodom will retain “highly qualified jobs and competencies” at the Mercedes-Benz plant in Moscow but it is unclear if the employees will retain their jobs in the process. The production and importof Mercedes in Russia had been halted earlier this year in March.
Meanwhile, the CEO of Mercedes-Benz, Russia, Natalia Koroleva in a statement said, “The main priorities in agreeing the terms of the transaction were to maximise the fulfilment of obligations to clients from Russia both in terms of after-sales services and financial services, as well as preserving jobs of employees at the Russian divisions of the company.”
The German carmaker’s CFO Harald Wilhelm, while presenting the third-quarter reports, said that this transaction may not affect the company’s profits or financial position when compared to previous quarters. “The completion of the transaction is subject to the approval of all relevant authorities,” said the German carmaker in a statement.
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Meanwhile, the Russian car dealer chain Avtodom said that it would choose a technology partner to continue operations at the Mercedes-Benz production facilities in the northwest of Moscow. As reports also suggest that following the completion of the deal the local investor will also provide maintenance for the Mercedes-Benz car owners in Russia.
(With inputs from agencies)
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